Financials
Stocks: Stocks are showing outward signs of the internal weakness I referenced last week. The Dow is setting up for a run back below 11,000 this coming week and I expect to see an acceleration to the downside once we get below that support level. Overall I remain very bearish and continue to advocate buying or spreading puts at this level. Fridayâ�,��"�s Jobs number only confirms that the economy is slowing as a whole and stocks can only ignore a slowing economy for so long before finally falling down.

Bonds: The yield curve continues to bounce after last weeks Fed. meeting. I continue to expect to see increasing volatility between now and the August 8th Fed. meeting. Look for bonds to ally back up to 108 but break out above that point should prove to be difficult in the near term.

Energies
Crude oil has seen a great run the last 10 days. Friday we saw a pullback of a little over a Dollar, but do not be alarmed. This was a needed pullback. It would have been the 10th up day in a row had we gone higher today. So this is further confirmation that the bull is back in crude. We continue to see a move towards $77 this coming week as the peak demand season continues in full swing. Unleaded and heating oil should also track crude oil higher but the real story from my point of view has been natural gas. The spread between natural gas and Crude oil continues to be as wide as it has been in years. I have been expecting a turn around in the natural gas market but so far this has not transpired. Overall I expect to see higher energy prices across the board with the largest moves coming from natural gas.

Metals
Metals did follow through on last weeks break out to the upside. We saw a bit of a pullback on Friday but this was minor. Overall we continue to see strength in metals going forward. With continued geopolitical unrest we could easily see a move above $650 in the very near term and I continue to expect to test the April highs before the end of the 3rd Quarter. Silver is poised to rally back above 12.00 as well. Copper had a very ugly shakeout this week and that tells me that copper is getting ready to take out its old highs too. Look for a move above 375 in copper in the very near term.

Grains 
Grains did follow through for most of this past week as I mentioned last week but then we did have a pullback on Friday due to the crop report that was interpreted as bearish. Overall I see Friday as just a normal pullback within a larger bull market and we are using this pullback to get long even more grains. I continue to favor corn and wheat over the soy complex for now. Derek Frey 07/07/06

Softs
Oj broke out to new highs earlier in the week and then had a dramatic sell off on Friday. I believe that sell off was nothing more than a â�,��"breakout shakeoutâ�,�. The key here is that OJ fell just short of the 1991 high (174.25) and resisted out. This level could hold this market back in the near term but longer term we will run right through it on the way to 2.00. Wait for stabilization and then buy or spread calls. Cocoa is on a solid run and we just exited out August call spread for a 300% return. I will be looking to go long on the next pullback if we get one. Coffee also had a â�,��"fakeout shakeoutâ�,� just like OJ and I continue to be bullish this market going forward. I would look at this recent sell off as an opportunity to get long if you are not already. The Sep 100 -120 call spread is in my opinion the best trade going to position yourself long while limiting the risk. Sugar hit my target of 17 this week and then sold off a bit. We may see a pause here but in the long run this market is still very much a buy. I expect to see sugar above 20 before then end of the year. Cotton continues to flounder and I remain long and wrong. This market cannot get out of its own way for some reason but it will in time and when it does we will see a very dramatic run higher.

Meats
Meats, overall, spent the week consolidating. After a very strong bull run over the past two months we are seeing a healthy pause in these markets. I would expect to see these consolidation ranges broken out of by the end of the month if not sooner. Bellies are a buy at the current level with stops below 90. Live cattle is also a buy with stops below 84. Feeders too can be bought at the current level with stops below 113.

Forex Currencies
EUR/USD: The Euro continued to soldier on this past week and Fridayâ�,��"�s NFP report was very favorable for the Euro going forward. I expect to see the recent highs near 1.2975 taken out this coming week.

USD/CHF: The swissy spent the week consolidating near the 1.22 handle, building a nice bear flag in the process. This should point to a move back down towards 1.20 in the coming days so be prepared for this pair to fall.

GBP/USD: The cable also consolidated most of the week before breaking out to the upside on Friday. This should open the door for a run to 1.88 â�,�“ 1.90 over the next few weeks.

USD/JPY: This market did break down to 114 late this past week and we are now on out way towards 112. I expect to see 112 by the end of the coming week. This market has little if any real support between 114 and 112 so the move lower should be quite quick.

AUD/USD: This pair followed through this past week more so than many of the other pairs here and as I mentioned last week, the Ausi should be the main beneficiary of the resumption of the bull trend in commodities. I continue to target 76.50 in the near term.

USD/CAD: This market consolidated most of the past week and I continue to target 1.10 in the near term. Stay or get short with stops above 1.1185 to start.

Derek Frey is Head Trader at Odom & Frey Futures & Options.

Risk Disclaimer 
Past performance is not indicative of future results. Trading futures and options is not suitable for everyone. There is a substantial risk of loss in trading futures and options.